Estimate your student loan interim repayments
What you need to know
When to use the estimation option
If you think your self-employed income will be less than the amount you earned last year, you can estimate your interim repayments.
Changing back to the standard option
When you use the estimation option you can't change back to the standard option for the year. However, you can re-estimate as many times as you like up until the third instalment date.
What happens if I underestimate?
Your estimate must be reasonable. If we find that your estimate and interim repayments at the third instalment date come to less than 80% of your repayment obligation, we'll charge you an underestimation penalty.
In this situation it would be best to re-estimate your income and adjust your interim repayment amount.
How the underestimation penalty works
Once we've received your tax return for the year we'll work out your repayment obligation. If you've underestimated your interim repayments (by 80%) we'll charge you 10% of the difference between what you should've paid (repayment obligation) and what you actually paid.
What you need to do
Follow these steps to tell us your estimated interim repayments.
- Estimate your income for the year.
- Complete the Student loan interim repayment estimation (SL3E) form.
- Send us the completed form.
What happens next:
We'll send a statement confirming the new payment amounts and dates, within 15 working days.
Example - estimation option for self-employed income
Kim runs a successful business as a self-employed gardener and landscaper. Her income for the 2008 tax year was $40,000, but she decided to cut down her hours in 2009 to spend more time with her family. She estimates her self-employed income for the 2009 tax year will be $33,000.
(Estimated income - repayment threshold) x repayment percentage = estimated 2009 interim repayment
($33,000 - $18,148) X 10% = $1,485.20
Kim will need to make three instalments of $495 on 28 August 2008, 15 January 2009 and 7 May 2009. She sends in a Student loan interim repayment estimation (SL3E) form and receives a statement from us confirming the new payment amounts and dates.
Find out more
Next steps
Date published: 07 Apr 2008
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